Hamas Weakened, But Likely To Survive

BMI View: The Hamas movement governing the Gaza Strip in the Palestinian territories has limited options available to alleviate its current economic and diplomatic isolation. Although we expect Hamas to retain control of Gaza, the movement's weakness is likely to exacerbate its internal divisions. In the near term, Hamas' fiscal strains and Gaza's dire operating environment underpin our weak outlook for Palestinian economic activity in 2014.

The second half of 2013 has been a strenuous time for the Islamist Hamas movement, which has ruled the Gaza Strip in the Palestinian territories since 2007. Hamas began the year in a strong position, having enjoyed a string of political victories over the last months of 2012. Qatar's then-Emir Sheikh Hamad bin Khalifa Al Thani visited Gaza in October 2012 and pledged US$400mn in development aid, a move that seemed at the time to dispel Hamas' diplomatic isolation while offering a much-needed new source of funds. An eight-day conflict between Israel and Gaza the following month bolstered Hamas' popularity and legitimacy with Palestinians, both in its own territories and in the West Bank. The ceasefire deal ending the conflict was personally brokered by Egypt's then-President Mohammed Morsi, whose Muslim Brotherhood movement enjoyed relatively favourable relations with Hamas.

Morsi's Overthrow Leaves Gaza Blockaded

Ticking Up Again
West Bank and Gaza - Unemployment By Area, %

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This article is tagged to:
Sector: Country Risk
Geography: West Bank and Gaza

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